The Council voted 46-5 for the measure, which would boost pay to $11.50 an hour, or $10 with benefits, for workers at companies that receive $1 million or more in city subsidies.

The City Council voted to override Mayor Bloomberg’s veto of the city living wage bill Thursday - setting up a legal battle.

The Council voted 46-5 for the measure, which would boost pay to $11.50 an hour, or $10 with benefits, for workers at companies that receive $1 million or more in city subsidies.

Bloomberg has vowed to sue to block the bill from taking effect, saying it unfairly interferes with the free market and will get in the way of economic development projects that could create jobs.

"I don't understand why the mayor would sue, but if he sues, we'll defend the bill, and if we defend the bill, we will win," said Council Speaker Christine Quinn.

The bill was watered down from its original version, but backers estimate it will cover 900 workers a year.

“Working people are struggling, and we’re making an important statement that when public money is going to private developers, the public has to get something in return,” said Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union.

The Council also voted to override Bloomberg’s veto of a bill that would require banks vying for city deposits to report on their lending efforts in poor neighborhoods.

The body also approved a $68.5 billion budget deal, which reversed threatened cuts to child care, after school programs, and fire companies.

Lawmakers also passed a plan to restrict storefronts on parts of the upper West Side to 40 feet wide, and banks to 25 feet.